In Long Island, there are 3 components to the solar incentives that are available:
- LIPA rebate - $1.75/watt for first 50,000 watts
- Federal 30% Income tax credit – no cap
- 5 Year MACRS Depreciation -
A typical 40kW solar energy system in LI might look like this:
*ITC stands for Investment Tax Credit or Income Tax Credit
Rebates & Incentives pay for 59% of the cost
A 40kW system would generate approx. 50,000 kWh/year or about $8,000 year.
- Cash-If you paid cash for this system, you would break even in Year 6 and would accrue savings of $280,000 over the system life.
- IRR of over 12.8%
- You can depreciate $204,000 over the first 5 years even though your net cost is only $98,000
- Levelized cost of Solar Over 25 Year System life
-
$.12/kWh for Solar electric
- $.32/kWh for Utility-produced electric
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- Utility Savings over system life of $377,810
If you financed your system at 6.25% for 9 years and put down 10% of the net or $9,800, you would get your down payment back after Year 1 and be cash positive from then on. You would save an average of $3,900/year during the loan period and over $11,000/year when your loan is paid off. You add value to your building and your system is exempt from any increased tax assessment.
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